Correlation Between Universal Health and Assure Holdings

Can any of the company-specific risk be diversified away by investing in both Universal Health and Assure Holdings at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Universal Health and Assure Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Universal Health Services and Assure Holdings Corp, you can compare the effects of market volatilities on Universal Health and Assure Holdings and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Universal Health with a short position of Assure Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Universal Health and Assure Holdings.

Diversification Opportunities for Universal Health and Assure Holdings

0.73

Correlation Coefficient

Universal Health  Assure Holdings

Poor diversification

The 3 months correlation between Universal and Assure is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Universal Health Services and Assure Holdings Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Assure Holdings Corp and Universal Health is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Universal Health Services are associated (or correlated) with Assure Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Assure Holdings Corp has no effect on the direction of Universal Health i.e., Universal Health and Assure Holdings go up and down completely randomly.

Pair Corralation between Universal Health and Assure Holdings

If you would invest  68.00  in Assure Holdings Corp on October 5, 2024 and sell it today you would earn a total of  0.00  from holding Assure Holdings Corp or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	4.76%
Values	Daily Returns

Universal Health Services  vs.  Assure Holdings Corp

Universal Health Services

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Universal Health Services has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's technical indicators remain comparatively stable which may send shares a bit higher in February 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Assure Holdings Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Assure Holdings Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Assure Holdings is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Universal Health and Assure Holdings

The main advantage of trading using opposite Universal Health and Assure Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Universal Health position performs unexpectedly, Assure Holdings can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Assure Holdings will offset losses from the drop in Assure Holdings' long position.

The idea behind Universal Health Services and Assure Holdings Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.